Video: Rice, Durbin, Graham, roundtable

Transcript of: Rice, Durbin, Graham, roundtable

MR. DAVID GREGORY:Washington
, the
battle
to rein in
government spending
is shaping up to be the major fight not only of this year, but of the
2012
campaign. As
Wisconsin
's Republican governor takes on the unions and orders Democratic lawmakers back to work, leaders in
Congress
are exchanging threats about a
government shutdown
if they can't agree on spending cuts.

MR. GREGORY:Where will it all lead? A special discussion this morning begins with two prominent voices of the
Senate
, Assistant Majority Leader
Dick Durbin
, Democrat of
Illinois
, and Republican member of the
Budget Committee
,
Lindsey Graham
of
South Carolina
. Then, more on the
budgetbattle
and what it says about
leadership
in
Washington
after the president unveils a
budget
that fails to address the largest drivers of the
country
's debt.

REP. PAUL RYAN (R-WI):Why did you duck? Why are you not taking this
opportunity
to lead?

PRES. BARACK OBAMA:This is not a matter of you go first or I go first.

MR. GREGORY:Our roundtable weighs in: Former governor of
Michigan
, Democrat
Jennifer Granholm
; former congressman from
Tennessee
, Democrat
Harold Ford
; Republican strategist and former
White House
counselor to
President Bush
,
Ed Gillespie
; and the man credited with inspiring the
tea party
movement,
CNBC
's
Rick Santelli
. Plus, the very latest on revolutions sweeping the
Middle East
. After
Egypt
, protests and violent crackdowns have spread to the
gulf states
. How will the
administration
balance
U.S.
interests with its interest in supporting democratic reforms? Our guest, the president's ambassador to the
United Nations
,
Susan Rice
.

Announcer:From
NBC News
in
Washington
,
MEET THE PRESS
with
David Gregory
.

MR. GREGORY:Good morning. And we will begin with those anti-
government
demonstrations that continue across the
Middle East
and
North Africa
. The governments of
Libya
,
Algeria
and
Yemen
each responding with violent crackdowns over the weekend. In
Bahrain
overnight, meantime, demonstrations have continued but
state security
forces have withdrawn, leaving behind more jubilant protests.
All of this
being watched quite closely and with a sense of unease by rulers in neighboring
Saudi Arabia
. Joining me now, the
U.S. ambassador to the United Nations
,
Susan Rice
. Ambassador
Rice
, welcome back to
MEET THE PRESS
.

AMB. SUSAN RICE:Thank you,
David
.

MR. GREGORY:Let me ask you specifically, as we go to the map, to talk about
Libya
. This appears to be the most violent crackdown where there isn't a whole lot that's actually known. In
Benghazi
, the eastern city,
Human Rights Watch
is reporting widespread
government
crackdowns, violent, the number of casualties unknown at this point. What can you say about what the
U.S. government
knows about what's happening inside
Libya
?

AMB. RICE:We're very concerned about the reports of violence and attacks on civilians. We've condemned that violence,
David
, and our view is that in
Libya
, as throughout the
region
, peaceful protests need to be respected. They need to be able to exercise their universal rights that people around the world share, and those rights include
freedom
of expression,
freedom
of assembly. And we will stand up in
support
of those universal rights everywhere. In addition,
David
, what we're seeing across the
region
is a yearning for
change
, a hunger for
political reform
,
economic reform
, economic
opportunity
, greater representation. And we
support
that very strongly.

MR. GREGORY:All right, but let -- we're going to get to that. But I want to -- specifically in
Libya
, is
Colonel Gadhafi
killing protesters? Is he ordering his troops to go out there and violently crack down?

AMB. RICE:From what we can tell -- and, as you know, the journalists are banned and...

MR. GREGORY:Right.

AMB. RICE:...and we are relying on reports from
Human Rights Watch
and other observers -- there has been less violence, very little so far in
Tripoli
, although that may be changing. In
Benghazi
, in, in the coastal areas, we're very concerned about reports of
security forces
firing on peaceful protesters.

MR. GREGORY:Let, let me ask you about
Bahrain
. We go back to the map and look at some of the scenes out of that
country
just over the causeway from
Saudi Arabia
, and also where the
U.S. Fifth Fleet
sits. The, the main center square in
Manama
, the capital,
security forces
have withdrawn from there.
The United States
has to be exerting a certain amount of influence to get the
government
there to step back and step away from a violent crackdown.

AMB. RICE:Well, we've been very clear with our partners in
Bahrain
that they ought to exercise restraint, that there's no place for violence against peaceful protesters there or anywhere else, and we've condemned that violence. We've had outreach from
President Obama
, National Security Adviser
Tom Donilon
, Secretary of State
Clinton
and other senior officials, urging that restraint and encouraging what is now transpiring, which seems to be the pullback of the
military forces
and now a real effort to engage the opposition in a broad-based dialogue that will enable the people's aspirations to be discussed and, we hope, respected.

MR. GREGORY:Can the
government
as it now stands survive, in your view, in
Bahrain
?

AMB. RICE:Well,
David
, I wouldn't want to be in the business of predictions in, in this very volatile environment, as we've seen
change
so rapidly across the
region
. But what we're encouraging
Bahrain
and other governments in the
region
to do is to recognize that this is a yearning for
change and reform
that is not going to go away, that it needs to be respected, and that they need to get ahead of it by leading rather than being pushed.

MR. GREGORY:You know, the, the -- among our Arab allies, according to diplomats that I talked to, they criticize what they see as inconsistency on the part of the
administration
with regard to some allies vs. other allies, and then adversaries.
The Economist
magazine framed this very

difficult choice for the president this way, I'll put it up on the screen:"By his actions," the magazine writes, "in
Egypt
, Mr.
Obama
has put other authoritarian allies on notice ... He thinks that even pro-Western autocracies that fail to
reform
deserve to die. But how much
reform
? And when will he decide they are dying?
Will Mr
.
Obama
abandon gradual reformers such as
King Abdullah
or King
Mohammed
as soon as enough people turn out on the streets of
Jordan
and
Morocco
? How many people are enough? To judge by the gale rattling the
Arab world
this week, he may have to answer such questions rather soon."

AMB. RICE:Well,
David
, for years, and indeed in -- throughout the course of this entire
administration
, we have been saying to our
friends
and partners in the Arab and
Muslim world
that

there needs to be a process for, for reform, that there are conditions that are inherently unstable:a youth bulge, high unemployment, a lack of
political
openness. And we have pressed publicly and privately for the kind of
change
that is necessary. Now, we don't see this as, as antithetical to our interests. We
support
the legitimate aspirations of people
all over the world
, including in the
Arab world
, to have representative governments, to have governments that respect their universal rights. And we don't see a dichotomy or a -- an inconsistency between beginning to respond to those aspirations and our interests...

MR. GREGORY:But can't you see how our allies are confused about where we're going to push, where we're going to
support
reforms, or where we're going to push them out of power?

AMB. RICE:No. We've been very consistent across the
region
. The message is the same: No violence; respect the universal rights of people to assemble, to protest, to speak, to, to form
political
organizations; and, and, and get ahead of
reform
, recognize that there needs to be lasting
politicalchange
and lasting economic
change
.

MR. GREGORY:But you can't say it's been consistent.

AMB. RICE:It has.

MR. GREGORY:The, the president pushed
Mubarak
to leave office. He has not done that in
Bahrain
, he has not done that in
Saudi Arabia
, he has not done that in
Jordan
.

AMB. RICE:No, no, no.
David
,
David
, look, each of these countries is different. Each of these circumstances will be decided by the people of those countries. We are not pushing people out or, or dictating that they stay. What we're doing is saying consistently across the board there are universal, universal
human rights
that need to be respected. There are aspirations and, and demands for
reform
that are, are legitimate and need to be addressed very urgently.

MR. GREGORY:Let,
let me follow
up on
Egypt
. One of the big stories that has come out of there in the protests was what happened to our colleague from
CBS News
,
Lara Logan
, who was attacked by a mob, sexually assaulted, according to
CBS News
.
And I
know that the
administration
has been pressing the
Egyptian military
and the
government
to get to the bottom of this. Are you satisfied that you have any real answers as to what was behind this?

AMB. RICE:David
, first of all, we're all horrified and outraged by what seems to have been a horrific attack against
Lara Logan
, and we've condemned it. And we are doing everything through our embassy and with the Egyptian authorities to ensure that, that we know as much as can be known about this, and that those who are responsible are held accountable.

MR. GREGORY:But no answers yet that you're satisfied with?

AMB. RICE:Not -- no, not yet.

MR. GREGORY:Let -- the, the other question in
Egypt
-- and again, where criticism comes from our allies -- is that the
U.S.
publicly and privately pushed
Mubarak
to go without a real sense of what would come next in terms of
democratic reform
, even a
democratic process
, since there's not an identified
opposition leader
as of yet. The
USA Today
reported the presence of the Muslim

Brotherhood, the most organized opposition force, and they write this:"In the scramble for power among groups of various
political
identity after last week's ouster of
Mubarak
, the
Brotherhood
-- an
Islamist
group that has held as many as 20 percent of the seats in
Egypt
's parliament in recent years- -is vowing to increase its influence on daily life in
Egypt
. "
The Brotherhood
would seek 'the preservation of honor' by stoning adulterers, punishing gays, requiring
Muslim women
to cover their heads and shoulders in public and killing Muslims who leave their faith, said [
Brotherhood
spokesman]
Abdel Fattah
, whose forehead bore the calluses of those who prostrate themselves five times a day in prayer." If the
Brotherhood
becomes a dominant part of Egyptian -- of the
Egyptian government
, is the
United States
prepared to do business, to do business with them as an ally that
Egypt
now is?

AMB. RICE:Well, first of all, there's no indication that the, the
Brotherhood
is going to dominate Egyptian politics. What you saw on the streets, and what we saw as recently as Friday in
Tahrir Square
, is a incredibly diverse
cross section
of Egyptian society, largely secular, seeking the same sort of
reform
-- male, female, religious, secular, young, and old. This is a cross-cutting movement for
change
. And we have confidence that if the democratic processes are respected, if there is time for parties to form, if there's an
opportunity
for
civil society
to organize, if the constitution is amended as it needs to be and there's
freedom
of expression, that the
Egyptian people
will responsibly choose new
leadership
and we will look forward to working with the democratic
Egypt
.

MR. GREGORY:You're saying that the
Brotherhood
should not be feared.

AMB. RICE:David
, what I'm saying is we have faith in the people of
Egypt
, and we have faith in
democracy
, and we believe in allowing democratic institutions to take root and to flourish. That's our aim in
Egypt
. We're going to
support
that. And we believe it needs to be credible and irreversible.

MR. GREGORY:Before you go, I want to ask you about the, the
U.N.
vote on a resolution brought forward by the Palestinians to declare
Israeli settlement
activity as illegal. You, as the
United States representative
there, vetoed that measure because of the word "illegal." The
administration
believes that settlements are illegitimate, but not necessarily illegal. My, my question is whether you worry that in the middle of all this protest, the
administration
has now angered enough Arabs in
government
and on the
street
by taking on this issue in this way?

AMB. RICE:Well, first of all,
David
, we vetoed the resolution not only because of the word illegal, but because our view is that we need to get the parties back to direct negotiations so that they can agree through direct talks on a two-
state
solution. That's the goal.

MR. GREGORY:Mm-hmm.

AMB. RICE:And the problem with this resolution is it was one-sided, and it was designed -- not designed, but it would have had the impact of hardening one or both sides and making it much harder for us to get them back to the table. So we have our eye on the big prize. Yes, for over four decades it has been
U.S.
policy to oppose settlement activity. We view it as illegitimate and corrosive to the
peace process
. I made that point clearly in our statement after the vote. But the aim,
David
, is to achieve an independent, viable
Palestinian state
living side-by-side next to a
Jewish state
of
Israel
.
That's what
we're going to continue to work to achieve. And, and we look to the parties to demonstrate their commitment to that goal and to take the important steps that need to be taken to build confidence and trust towards that end.

MR. GREGORY:All right, Ambassador
Rice
, we're going to leave it there this morning.
Thank you very much
...

AMB. RICE:Good
to be with you
.

MR. GREGORY:...for being here. We focus now on the
battle
over
government spending
that is taking place, as I mentioned, from
Wisconsin
to
Washington
and beyond. Joining me now two prominent voices in the
Senate
: the assistant majority Leader,
Dick Durbin
, the Democrat of
Illinois
, and Republican member of the
Budget Committee
,
Lindsey Graham
of
South Carolina
. Welcome to both of you. Senator
Graham
, I do want to start with you and just follow up on one point about what's happening in the
Middle East
. As Ambassador
Rice
suggested, so much concern about the nature of the crackdowns in certain countries now. Are you satisfied with any measure of consistency you see from the
administration
in terms of how they are using their influence against various countries?

SEN. LINDSEY GRAHAM (R-SC):Well, the one, one suggestion I would make is we've been very inconsistent and too timid when it comes to
Iran
. They've done a good job in
Egypt
. I think we should have a policy of urging old
friends
to do better in replacing old enemies. So I'd like to see
regime change
in
Libya
. I'd like to see
regime change
in
Iran
. I think we need to be tougher on companies that do business with
Iran
. But, generally speaking, the
administration
, I think, has handled
Egypt
well and is trying to stay ahead of this when it comes to
Jordan
,
Bahrain
, and
Saudi Arabia
.

MR. GREGORY:All right. There's so much to get to on the
budget
. Senator
Durbin
, I want to go there immediately. It's interesting, here, here is the president's
budget
for next year, and yet the fight hasn't even started over this because
Congress
is still fighting about this year's
money
, funding the
government
for this year. A dramatic
House
vote over the weekend and here was a summary in
The Washington Post
, that I'll put up on the screen. "
The House
approves dramatic cuts in
federal
spending, 235-189.
The Senate
is expected"
the Post
goes on, "to take up its own version of the spending measure the first week of March, just before a
March 4
deadline for when the current funding resolution expires. With
Democrats
pushing to keep spending at
2010
levels for the remainder of this year, the two sides begin a grueling negotiation process more than $61 billion apart." Senator
Durbin
, are we heading towards some kind of
government shutdown
?

SEN. DICK DURBIN (D-IL):I certainly hope not, and we've made it clear from the start that that is the worst outcome. If we end up shutting down the
government
and calling into question whether we're going to meet our obligations for
Social Security
checks and paying our troops, then that is an absolute, utter failure. We can do better.
And I
think we need to sit down in a positive, constructive way and work out our differences. There are differences. But the starting point is that we know we need to cut spending, we know we need to live within our means. And we believe that we can find a way to do this for the remainder of this fiscal year.

MR. GREGORY:But how does this get resolved? Here was Senator
Reid
, the majority leader, Senator
Graham
, talking about the
House
, you know, passed their end of it and now there's not a lot

of time to negotiate. Speaker Boehner saying, "Read my lips:We're going to cut spending," and this is how Senator
Reid
responded.

SEN. HARRY REID (D-NV):And now he's resorting to threats to do just that without any negotiations. That is not permissible. We will not stand for that. He's wrong.

MR. GREGORY:Do you think we're headed toward a
government shutdown
?

SEN. GRAHAM:The only way we'll shut the
government
down is if our Democratic colleagues insist on keeping the
federal government
large and unsustainable. From
2008
to
2010
the
federal government
in non-defense
discretionary spending
grew about 24 percent. Very few people in
America
had that increase in their budgets. And if you count the stimulus, over 80 percent increase in spending. What I hope to happen is that we'll find a way to resolve this by reducing spending in a bipartisan fashion.
The House
members did exactly what they campaigned on. The
Democratic House
was fired because they spent too much. There will probably be a temporary
CR
, but it should have some spending cuts as a down payment on controlling the size of our
federal government
.

MR. GREGORY:But you're suggesting compromise, some spending cuts. You're suggesting Republican leaders in the
House
have got to be able to compromise because the
Senate
's not going to pass what they just passed.

SEN. GRAHAM:The, the, the, the only reason I'm suggesting is that we do a temporary
CR
for a week or two is we just don't have enough time. But I won't
support
a
CR
unless it has some spending cuts.

MR. GREGORY:Right.

SEN. GRAHAM:But I'm going to side with the
House
when it comes to getting back to
2008
spending levels.
That's what
they campaigned on. They're just doing what they promised the
American people
. And getting back to
2008
levels I think is a good start. And we got a lot more to do than just that.

MR. GREGORY:So, just so everybody knows, a
CR
is a
continuing resolution
, which is a way to fund the
government
for the rest of the year. Senator
Durbin
, where do you see room for compromise here? Are, are your -- you, as leaders, in, in -- on the Democratic side in the
Senate
are going to have to, to move a bit on cutting dramatically
government spending
.

SEN. DURBIN:David
, understand the starting point. We've already cut $41 billion below the president's
budget
for this fiscal year in this -- the way we're currently funding our
government
. And

now the question is:How much further should we go? And there are serious questions to be answered.

MR. GREGORY:There's -- the $41 billion is just less than the level that it was funded at before.

SEN. DURBIN:No, it's less than the amount asked for by the president for this year, $41 billion below it, and the
House
has gone $100 billion below it. And so let's be very candid, both sides have

made cuts. The question is:What is the right thing to do at this moment? The
deficitcommission
took a look at our
economy
and said, "Be careful. Make sure that you move towards fiscal solvency for the
United States
, but do it in a fashion that will not harm the growth of our
economy
." You can't reach a
budget
balance with 15 million Americans out of work. We need to invest in things

that count:Education and training for our workers; innovation so that we have that kind of spark of creativity that creates new businesses and new jobs; and investment in the infrastructure of
America
, building things that are going to make us strong for generations to come.

MR. GREGORY:But...

SEN. DURBIN:If I have anything to fault with the
House
approach to it, I think they went too far in their cuts.

MR. GREGORY:Let me ask you about what is becoming a
federal
issue, and that is what's happening in
Wisconsin
. This was the scene on Friday in the rotunda in
Madison
as
union
workers were protesting the move by the governor of
Wisconsin
to demand a greater participation on unions in terms of pension contributions, as well as
health care
contributions, also trying to end
collective bargaining
in the
state
. And you see the response there.
President Obama
did an interview and weighed in on this. This is what he had to say.

PRES. BARACK OBAMA:Some of what I've heard coming out of
Wisconsin
, where you're just making it harder for public employees to collectively bargain generally, seems like more of an assault on unions.
And I
think it's very important for us to understand that public employees, they're our neighbors, they're our
friends
.

MR. GREGORY:Senator
Graham
, did the president
do the right thing
weighing in to this controversy?

SEN. GRAHAM:I think the president should be focusing on what we're doing in
Washington
. The president's
budget
this year is the
highest level
of spending as a
nation
-- 25.3 percent of
GDP
-- since
World War II
. So that's not the number to use to get this place in, in, in fiscal sanity. We should be looking at the dollars we're actually spending.
That's what
the
House
did. But when the president talks about
Wisconsin
, I think that's -- that really is inappropriate. The governor of
Wisconsin
is doing what he campaigned on. He said he would ask contributions from
government
employees for pension and for
health care
at a level that I think is reasonable. And he also put on the table renegotiating and reforming
collective bargaining
. He told me yesterday it takes 15 months to do a contract with
government
employees in
Wisconsin
. And so he's doing what he said. There was an
election
on his proposals, and he won, and he should be allowed to fulfill his mandate just like the
House
Republicans.

MR. GREGORY:Senator
Durbin
, is the
White House
, is the president, using his own campaign operation, an operation of supporters, to fuel protests in
Wisconsin
?

SEN. DURBIN:Let me tell you why what's happening in
Wisconsin
, just north of
Illinois
, goes way beyond the discussion of the
Wisconsinbudget
. If you think this is just about
money
and the
budget
, then you might believe
Cesar Chavez
was just working to get a couple pennies more per pound for grapes or that
Martin Luther King
was really working for access to hotels and restaurants. There's a much bigger issue at stake here. For over 80 years in
America
, we have recognized the rights of our workers to freely gather together, collectively bargain, so that they could have fairness in the workplace and fairness in compensation. And that is what's at stake here. It goes way beyond this
budget
issue. This governor of
Wisconsin
is not setting out just to fix a
budget
, he's setting out to break a
union
. That is a major move in terms of
American history
. I believe the president should have weighed in. I think we should all weigh in and say, "
Do the right thing
for
Wisconsin
's
budget
, but do not destroy decades of work to establish the
rights of workers
to speak for themselves."

SEN. GRAHAM:David
, if I could just add, this is a campaign flier I have -- I don't know if you can see it -- from the last
election
cycle where
Wisconsin
unions said, "If you elect this guy,
Scott Walker
, he's going to
reform
or limit
collective bargaining
." He was open about what he was going to do about contributions to pensions and retirement, and he told the people of
Wisconsin
, "I'm going to
changecollective bargaining
because it is -- impedes progress when it comes to education. It's too hard to fire anybody, it is too complicated.
And I
'm going to
change
that system." So, in a
democracy
, when you run on something, you do have an obligation to fulfill your promise. He didn't take anybody by surprise. He's doing exactly what he said. There was a referendum on this issue, and the unions lost. And the
Democrats
in
Wisconsin
should come back to
Wisconsin
to have votes.

MR. GREGORY:All right. Let me, let me take a break here. We're going to come back, talk more about the president's
budget
and the question of
leadership
in
Washington
on the biggest drivers of our
nation
's debt. More with Senators
Durbin
and
Graham
in just a moment.

MR. GREGORY:Coming up, more with Senators
Durbin
and
Graham
. Can both parties come to an agreement on spending or will there be a
government shutdown
? Up next, after this brief
commercial break
.

MR. GREGORY:We're back, joined again by Senators
Dick Durbin
and
Lindsey Graham
. And, Senator
Durbin
, you mentioned the debt
commission
, the president's debt
commission
on which you served, and you supported its findings. They're out with an op-ed in
The Washington Post
today about the president's
budget
. And this is, in part, what they had to say. "To be sure, the president's
budget
doesn't go nearly far enough in addressing the
nation
's fiscal challenges. In fact, it goes nowhere close." This was a president, Senator
Durbin
, who said, during the transition, that we cannot kick the can down the road when it comes to entitlement spending, the biggest drivers of our
nation
's debt. And yet he chose not to do so in this
budget
. Why?

SEN. DURBIN:Well, let's give credit where it's due. The president's
budget
will free spending and, over the course of five years, is going to reduce our, our, our
deficit
by some $400 billion. We'll see domestic
discretionary spending
at the lowest level, as a percentage of
GDP
, since President
Dwight David Eisenhower
. It is
a step in the right direction
, and it's consistent with the first two years the
deficitcommission
recommended. Now, as a member of the
commission
, I will tell you we went beyond that. We said, "After the first two years, we've got to have a 5 percent reduction in spending the first year, and then half of, of
the cost of living
increase reduction for the next seven years." So we do achieve more through the
deficitcommission
.

Now, David, the good news is this:There are six of us, three
Democrats
and three
Republicans
still meeting, looking at the
deficitcommission
as a template or as a goal, and trying to find a way to work together in a bipartisan fashion in the
Senate
to come up with a reasonable way to deal with this
deficit
. We can build on the president's
budget
into deeper cuts, but we need to put everything on the table, with the exception of
Social Security
, which I'd like to mention. Everything else needs to be on the table.
The House
, in their
budget
, just dealt with 12 percent and made a dramatic cut in our
budget
of 12 percent in domestic discretionary. I might say...

MR. GREGORY:But, but, but, Senator, it's -- everything is not on the table. I mean, the point is you're talking about -- you're heralding 12 percent of the
budget
. That's not where the big -- that's not
where the money is
here when it comes to driving up the debt. You even said about the debt
commission
that the president probably doesn't want to wear that collar into the next
election
. I've

talked to administration officials who say the strategy here is a political one:Get the
Republicans
to
step forward
first, make the big suggestions on where to cut entitlements, and then that could be used against them in the
election
.

SEN. DURBIN:Well,
David
, let me tell you, after we get beyond who goes first and bragging

rights about who cuts the most, the bottom line is:Can we reach an agreement on a bipartisan fashion with senators of both
political parties
and move forward? What the president has said, he's open to this
conversation
. I'd like to say one word about
Social Security
from
my point of view
.

MR. GREGORY:Well, let me just hold that. I want to get Senator
Graham
's response on this question of whether the president is making good on his promise to lead on this issue.

SEN. GRAHAM:Well, it's clear to me that he, he did not lead in the
State of the Union
. This
budget
does nothing, his
budget
does nothing on entitlement spending, and we all know that's where the
money
's at. It's a politically timid
budget
, it's a fiscally timid
budget
. It goes nowhere near where the debt
commission
went. It was $4 trillion over a decade. It allows the debt to double in four years, then triple by
2019
. It's just not the document we need to keep from becoming
Greece
. The debt
commission
, if given life, can
change
this
country
. And to Senator
Durbin
, you have my undying respect and gratitude for working with
Republicans
and
Democrats
to vote on a document that is a blueprint to save this
country
from fiscal collapse. Forty cents of every
dollar
we spend, we borrow. And in 20 years from now, all of the
money
we have in revenue going to go to pay the debts
Social Security
,
Medicare and Medicaid
, nothing left for the
national defense
,
homeland security
, etc. So
Dick
, let's do something about the
tax code
. Let's flatten it out, do away with all deductions except home interest and charitable giving. Let's be bold when it comes to
Medicare
. And let's put
Social Security
on the table in a rational way, like
Ronald Reagan
and
Tip O'Neill
did. There's no reason not to adjust the age
over time
for people under 55 to 69 or 70.
You and I
can afford some means testings to our
benefits
. That will save
Social Security
from bankruptcy. It's headed toward across-the-board cuts in 20 years. So I applaud what you're doing with the other senators, but let's do put
Social Security
on the table. Me and
Senator McCain
are going to work on a solution. I'd like to share it with you.

SEN. DURBIN:I -- first, I want to thank my colleague for the kind words.
Social Security
does not add one penny to the
deficit
.
Social Security
untouched will make every promised payment for more than 25 years. But the
deficitcommission
was given a charge, add 75 more years of solvency to
Social Security
. It came up with an approach. I think, frankly, another
commission
,
Pete Domenici
and
Alice Rivlin
's
commission
, came up with a better approach. We need to move on
Social Security
, but let's put it on a track that runs parallel but separate to
deficit
reduction. The
Social Security
program, as it's currently put together, does not have any impact on the
deficit
.

MR. GREGORY:Senator
Graham
, is that -- I mean...

SEN. GRAHAM:If I could just -- well, that -- let's just...

MR. GREGORY:...few people believe that there's not an arithmetic problem with
Social Security
.

SEN. GRAHAM:You know, when I was 21 and 22, my parents died, I had a 13-year-old sister. I was in law -- college in
law school
. If it weren't for survivor
benefits
coming to my sister from my parents' contribution, we would have had a
hard time
making it. Today I'm 55, I don't have any kids. You know, we're, we're paying more in
benefits
than we're collecting in taxes in about five years. In
2037
, maybe even sooner, you have to cut
benefits
by a third across the table. All I'm suggesting is let's do with
Social Security
what
Ronald Reagan
and
Tip O'Neill
did. Let's get it in a sustainable glide path. You know the age has to be adjusted for all entitlements, including
Medicare
. To go 67 to 69 like
Reagan
and
Tip O'Neill
did, for people under 55, is amenably doable.

MR. GREGORY:All right.

SEN. GRAHAM:And it does help our long-term debt. To take it off the table and, and -- is just the wrong thing to do. And, and it's just very disappointing.

MR. GREGORY:All right. We're going to have to leave it there. More of this debate ahead, for sure. Thank you both very much. And coming next,
budget
battles in
Washington
and in
state capitals
across the
country
. We've been talking about all eyes on
Wisconsin
this week as
government
workers protestered -- protested, rather, and
state legislators
walked out. Will other
states
now follow? And the president came under fire from
Republicans
for not
being bold
enough in his own
budget
. Is the
budget
blueprint a failure of
leadership
or a
political power
play eyeing the
2012
elections? Our roundtable weighs in: former
Michigan
Governor
Jennifer Granholm
, former Congressman
Harold Ford
, Republican strategist
Ed Gillespie
, and
CNBC
's
Rick Santelli
.

MR. GREGORY:We are back, now joined by our roundtable: Republican strategist, former
White House
counselor to
President Bush
,
Ed Gillespie
;
CNBC
's
Rick Santelli
; former congressman from
Tennessee
, Democrat
Harold Ford
; and former governor of
Michigan
, Democrat
Jennifer Granholm
, who left the statehouse last month and who, we're pleased to say, will be joining us on a regular basis as a contributor to our roundtable. So, Governor, welcome particularly.

FMR. GOV. JENNIFER GRANHOLM (D-MI):Thank you.

MR. GREGORY:Nice to have you here. Well, there is so much to talk about, and it's -- as I said at the top of the program, from
Wisconsin
to
Washington
it is this fight about reining in
government spending
. So here it was, look at this picture, the sea of red.
Union
protesters in the rotunda in
Madison
,
Wisconsin
, over the move by Governor
Walker
to take on the unions. And this
battle
is ongoing. This is how
The New York

Times reported it on Saturday, to kind of frame the issue:"The images from
Wisconsin
with its protests, shutdown of some
public services
and missing Democratic senators, who fled the
state
to block a vote evoked the
Middle East
more than the
Midwest
.

"The parallels raise the inevitable question:Is
Wisconsin
the
Tunisia
of
collective bargaining
rights?"
Governor Granholm
, what is at stake here?

GOV. GRANHOLM:Well, I don't think anybody disagrees that there has to be cuts.
And I
don't, I don't hear anybody on either side saying that there shouldn't be. And the, the, the workers on Friday said that, "We'll accept the contributions to the pension. We'll accept the contributions to
health care
." So given that the governor has already gotten them, what he sought to do to resolve his
budget
problem, what is this really exposed to be but an attack on
collective bargaining
? And so I, I love -- we were talking earlier, I love the smell of
democracy
. It's so inspiring that so many people feel moved to come out and express themselves. But this is -- this in
Wisconsin
, make
no doubt about it
, the, the -- everybody understands that cuts need to happen. But this is really about
collective bargaining
.

MR. GREGORY:But,
Ed Gillespie
, is this then
open season
on the unions by a Republican governor? Is that what this is about?
That's what
the president said.

MR. ED GILLESPIE:Well, I was interested to see the president insert himself into the
Wisconsinbudget
debate.
And I
tend to agree with
Lindsey Graham
, not surprisingly, that he might want to focus more of his attention on trying to get control of
federal
spending in
Washington
. But look, right now what
Scott Walker
, the governor of
Wisconsin
, is proposing is that the members of the unions in, in the public employee unions in
Wisconsin
vote every year to validate their, their
union
participation. That is
democracy
. Empowering the worker to make a determination as to whether or not they want to contribute these compulsory
union dues
or not makes a lot of sense. And that's really what this is about. The, the
labor unions
want to lock people in, you know, as soon as they get a job, where they don't really have a choice as to whether or not they can vote for, for having
union
representation or not. I, I think
democracy
's a good thing. We ought to have more of it.

MR. GREGORY:Harold Ford
, look at the numbers from
2008
in
Wisconsin
in the presidential race. This was a
state
that the president carried 56 to 42; a
swing state
, you wouldn't know it by those numbers. But more
Republicans
, certainly in the
midterm election
, had strong gains. And make no mistake, the president has now elevated Governor
Walker
there in
Wisconsin
. This is about energizing unions. This is the core of the
Democratic Party
. And this is going to be a big issue now.

FMR. REP. HAROLD FORD JR. (D-TN):It's become more
political
, or as much
political
as it is substantive, around the
budget
. The president obviously wants to hold onto his base, energize that base for the next year's
election
.
Scott Walker
and the
tea party
is understanding their argument. But I think it's important to understand that you can't look at all of these
states
as one. The governor touched on it very well. This issue in
Wisconsin
deals with whether or not public employees ought to pay into their
health insurance
program, which they don't now, and to their pension program, which they don't. The unions have agreed to do this. This has now become --
and I
think
President Obama
was right in his description of it -- it's questionable whether or not he should have gotten into it -- but this has now become an assault on unions and the ability to organize in
Wisconsin
. I'm hopeful that the governor, if he's serious about the math, which he obviously is, that he will take the unions at their word, saying, "We are now prepared," which is the right thing to do. In other
states
where public employees are not doing this, they should use this as a model. But to, to say that
collective bargaining
ought to be ended, I'm uncomfortable with that.
And I
think
Republicans
, particularly
Scott Walker
, may find himself in an overreach position if he, if he continues that line.

MR. GREGORY:But,
Rick Santelli
, why not just take them at their word that they were willing to accept these provisions, but leave
collective bargaining
alone?

MR. RICK SANTELLI:Well, I think that has implications for some of the
local governments
in
Wisconsin
, and I also think that, you know, I'm not a
collective bargaining
expert, but even going back to
FDR
, there's always been issues as to the sustainability and the appropriateness of having
collective bargaining
when it comes to the public employees.
And I
think this is an issue that needs to be put out into the air and see -- many, many other
states
, ultimately, might have -- not have the same
balance sheet
as
Wisconsin
, but I think, ultimately,
collective bargaining
, even from a
federal level
, these are big issues, and these costs need to be put under control. If the
country
is ever attacked like it was in 9/11, we all respond with a sense of urgency. What's going on on
balance sheets
throughout the
country
is the same type of attack.

MR. GREGORY:Well, let me pick up on that.
Governor Granholm
, the
national conversation
is about how to rein in
government spending
.

GOV. GRANHOLM:Right.

MR. GREGORY:Republicans
, they won in November. They are now owning this
conversation
, it seems, more than
President Obama
and the
Democrats
are. Is that a problem politically?

GOV. GRANHOLM:I think it's clear that the
Democrats
want to rein in spending, but they don't want to damage the
economy
. The whole point is, you know, I think there is a real overreach with respect to the interpretation of the November results. The November results, sure, some people voted the way they did because they wanted to cut everything out of
government
. But most people, I would venture to say, did it because they were uncomfortable with the fact that the
unemployment rate
is high, that this is about jobs and the
economy
more than it is about the
deficit
. You slash too much, you hurt jobs and the economies. So where's that balance? And let me just jump back for one thing on
Wisconsin
.

MR. GREGORY:Mm-hmm.

GOV. GRANHOLM:On -- you know, there are
states
in this
country
that have massive deficits that don't have
collective bargaining
, and there are
states
that have very low deficits that do have
collective bargaining
.

REP. FORD:That's a great point.

GOV. GRANHOLM:That is not the issue. The -- if you want to have a discussion about
collective bargaining
, have that. But this is about deficits.
And I
can just tell you, as governor of
Michigan
over the past eight years, I cut more out of
state government
that -- as a percentage, per capita, than any
state
in the
country
. Every single year we had to cut. In fact, I -- by a large percentage.
And I
did it in partnership with the unions. Our unions gave over $700 million in concessions. I asked them to pay the new employees 20 percent toward their healthcare
benefits
. They don't even have a pension. They have 401(k)s. They have a
defined contribution plan
and not a
defined benefit plan
.

MR. GREGORY:OK. I, I don't want to talk too much about
collective bargaining
and unions. OK.

GOV. GRANHOLM:I'm just saying...

MR. GREGORY:I got it. Yeah, Ed.

MR. GILLESPIE:All right. Well, let me end with this, which is we're not talking about eliminating
collective bargaining
, what we're talking about is limiting
collective bargaining
to wages, not the
benefits
package...

MR. GREGORY:Right, right.

MR. GILLESPIE:...and having the
union
members vote themselves every year whether or not they want to continue that.

MR. GREGORY:Let me, let me continue on this theme about who's kind of winning the, the
austerityconversation
. The president was pressed during a news conference this week about why not move forward and, and, and stop kicking the can down the road and present in his
budget
cuts to
entitlement programs
. This is what he said about the need to work together.

PRES. BARACK OBAMA:This is not a matter of you go first or I go first. This is a matter of everybody having a serious
conversation
about where we want to go and then ultimately getting in that boat at the same time so it doesn't tip over.
And I
think that can happen.

MR. GREGORY:The reality is, talking to
administration
officials,
Harold
, they want the
Republicans
to go first. They want them to propose big entitlement cuts so they can, some, frankly, demagogue them come
election
time. Is that
leadership
?

REP. FORD:I'm not convincing it's winning -- I'm not convinced it's winning
leadership
. I'm a believer that a president looks strongest and best in mid-November to the end of December when he brokered a tax deal, an extension of the
tax cuts
. He was able to broker an extension, or I should say a rewriting of the
START treaty
. Allowing all Americans, regardless of their sexual orientation, to serve openly in the
military
, that was
leadership
on the president's part that allowed that to happen. I think they have to show the same kind of
leadership
on this
front
. If not, you run the risk of allowing a
conversation
that you believe in, hoping that concessions is -- and such, is coming from unions in different
states
happen, but another
conversation
around
collective bargaining
and an assault on unions taking a course and a direction you don't want. If the president leads on reducing spending, particularly entitlement spending, it's not much. You listen to
Lindsey
and you listen to
Scott
-- I mean,
Dick Durbin
, they both have said
Social Security
ought to be on the table.

MR. GREGORY:Right.

REP. FORD:If the president leads on this
front
, I happen to believe he will benefit politically. But more important, the
country
will benefit in the long term. I'm 40. I'm willing to give up my
benefits
till I'm 70 and even have them means tested after that point because of the blessings that have come my way as an American.
And I
believe there are more like me.
And I
believe the president and
Republicans
would, would find to lighten that.

MR. GREGORY:Well, let me -- let me flip this around,
Rick Santelli
. Why shouldn't a Democratic
administration
, this president, say, "
Let's see
what the
Republicans
are willing to do." OK? "I went out big on
health care
and they weren't there. They demagogued me. Why not see what they're willing to propose and see if we can structure a grand bargain, because I
haven
't had much success in actually working them, if we want to get something done."
What's wrong
with that approach?

MR. SANTELLI:Well, I think what's wrong with that is this past week we just had the two-year anniversary of the original
stimulus package
. So there are issues regarding spending that have been here through the entire
administration
.
And I
think, at this point, the politics -- and there's always going to be
political
gamesmanship, especially with such a key
election
coming up in
2012
. But this is a time, as Congressman
Ford
has said, that whoever owns this argument, the public is going to get it. It's not going to be easy. Pulling a
dollar
out of anybody's pocket is not going to be something where people are going to be raising their hands to volunteer. And it's -- we're going to get there anyway. I think the president ought to be aggressive and be a true leader and step out on this issue.

MR. GREGORY:All right. We're going to take a break here. We'll come back, talk more about this
leadership
question on the
budget
, but also the politics of
2012
, deeply impacted by this very debate. More with our roundtable right after this.

MR. GREGORY:We are back with our roundtable.
Governor Granholm
, we've been talking about the, the
big picture
,
politicalleadership
question. But the pressing issue is the prospect of a
government shutdown
over spending cuts this year in
Congress
. Who wins, who loses in this situation?

GOV. GRANHOLM:I think it is a lose/lose. I've been -- I've seen this movie, I've been in it. We...

MR. GREGORY:Right. A couple of times as governor.

GOV. GRANHOLM:Yes. In fact, in
2007
. But this is the -- you will be rewarded in this way. You will be in the cellar of American esteem, both sides. It's a pox on all your houses. People at home sit there and go, "What the heck just happened? I sent all these people to
Washington
to fix things, and they shut it down."

MR. GREGORY:Right.

GOV. GRANHOLM:It is a disaster.

MR. GREGORY:Ed
, you've been inside the room.

GOV. GRANHOLM:And I
say this to both sides.

MR. GREGORY:You've been inside the room, not for this particular kind of thing. But, you know, you know Speaker
Boehner
well. You've worked with him when you were in, in the
White House
. He may want to make a deal, I would think, but he also said, "Hey, you know, don't
look at me
, I'm just the speaker." He has a pretty restive base here he's got to deal with.

MR. GILLESPIE:Well, a couple things. First of all, they passed their
continuing resolution
in the
House
.

MR. GREGORY:Yeah.

MR. GILLESPIE:The only way you don't, you know, the, the
House
can shut down the
government
is by not moving forward a
continuing resolution
, which they have.
The Senate
, under Democratic
leadership
, has yet to do so, and they're out all next week. So there's a little bit of chicken being played here by, by Senator
Reid
.

MR. GREGORY:Yeah.

MR. GILLESPIE:And then the second this is, you know, they talk about "We're going to freeze spending." We're -- they're going to freeze spending after a 24 percent increase in
federaldiscretionary spending
. That's like gaining 24 pounds over
Christmas
and saying "My new year's resolution is I'm going to keep it. I'm not going to lose any of it, I'm not going diet it off. I'm going to
keep it right there
." That is not what the voters are saying. And the fact is, we talked about
economic growth
, the most -- the biggest drag on
economic growth
is this looming debt, and that -- not looming but mounting debt that is causing a problem in the, in the
credit markets
and is causing a sense amongst voters of uncertainty. And the
Republicans
in
Congress
are trying to address it, the
administration
's not.

MR. GREGORY:It's interesting,
Harold
, because the president in the
State of the Union
tried to say, "Look, we need to deal with the debt, but we've also got to win the future. We've got to
get the balance right
between
austerity
and investment." But the
conversation
is really about how much
austerity
are you going to
support
? Is he losing ground here?

REP. FORD:No. I think if, in the coming weeks, in the coming days, you don't see a kind of spirit that
Governor Granholm
just, just suggested that shutting down
government
is bad for both sides, the president's got to lead on that
front
. I'd say one other thing. I was in
Congress
in -- from '96 to and there was a belief that the
budget
could not be balanced, that the debt was going to continue rising. Every politician would go to the floor and bemoan we're going to have deficits
as far as the eye can see
.
The Congress
balanced the
budget
under -- with a
Congress
and a president named
Clinton
that really worked hard to get it done. We started to grow again, and we found ourselves in a position where we were taking in more
money
than we were spending. So we can get out of this mess. The president's message of winning the future is the right one. But, unfortunately for the president, the politics is around
deficit
reduction right now.

MR. GREGORY:Yeah, right.

REP. FORD:People want jobs created, without a doubt. And
Republicans
better be careful because if they focus too much on this and jobs aren't created they will be punished. But right now, at the moment, people want to see
government
, like themselves, tightening their belt, getting responsible, being held accountable, and doing things that just seem sensible.
Social Security
is a sensible thing to do. Cutting part of the spending is a sensible thing to do.

MR. GREGORY:Right.

REP. FORD:And hopefully my party recognizes that.

MR. GREGORY:And you're teeing up -- Governor
Chris Christie
of
New Jersey
, talk about
austerity
. He gave a speech here in
Washington
this week that got rave reviews in part because of his plain language about taking on issues like
Social Security
. Here's what he said.

GOV. CHRIS CHRISTIE (R-NJ):You're going to have to raise the
retirement age
for
Social Security
.
Ho
, ho! I just said it, and I'm still standing here. I did not vaporize into the carpeting, and I said it.

MR. GREGORY:He didn't vaporize into the carpeting,
Rick Santelli
. I mean, this is the kind of
plain talk
that people are responding to. And yet, you just heard from Senator
Durbin
, you know, they want to take
Social Security
off the table right now in terms of dealing with that debt reduction.

MR. SANTELLI:Senator
Durbin
is from my
state
: 3.7 billion
MUNI
issuance that they need to bring to the market. They
haven
't paid vendors. You know, it has come to the crossroads where if we don't start to make the changes that the governor and the congressman know are going to take time, we will have
austerity
forced on us, and that type of
austerity
is going to be much messier. There really isn't much
opportunity
for debate here. We do need action. And even though the
interest rates
on the
federal
side
haven
't moved markedly higher, a lot of the assumptions for these outlier years for the
deficit
are assuming fairly good behavior on
interest rates
and a fairly robust
economy
. And when the
Clinton
years came forth with all the jobs and a surplus, we were in a much different economic time. We had an industrial
computer revolution
going on in
California
, you had the wall fall in the late '80s that freed up an enormous amount of peace dividend
money
. Our
economy
is not nearly as aggressive at this time around.

MR. GREGORY:But,
Ed Gillespie
, look at the politics of this. This was some polling out of
New Hampshire
, which will be the, the first primary
state
in
2012
after the
Iowa caucuses
, and here's how it looks on the
GOP
side. It's
Romney
leading there commandingly, and he even looked good at this early juncture head-to-head against
President Obama
. My question though,
Ed
, is whether or not
Republicans
are looking at all this and saying, "Look, we got to own the
budget
message, yes." But are they worried that
Republicans
overreach here, which is what, of course, the, the
Democrats
and, and the
White House
are counting on?

MR. GILLESPIE:I don't sense that right now,
David
. I've never seen a
political
environment, and particularly on the
Republican side
, but generally as well, where there is a greater risk to be seen as unwilling to cut spending than there is to be cutting spending. I've never seen a dynamic like this like we see right now. And again, that's why I think
President Obama
's out of touch. I mean, you know,
Amtrak
loses $1 billion a year. He's proposing $53 for high-speed rail in his
budget
. We're not losing
money
fast enough? We got to lose it at a faster rate? It is -- they -- there's a disconnect here that I think is going to cost him in
2012
.

MR. GREGORY:OK. All right, I, I got to -- I got to leave, I got to leave it there. Thank you all very much. I wanted to save a
little time
because before we go we do want to remember
NBC
newsman and former moderator of
MEET THE PRESS
,
Bill Monroe
, who died this week at the age of 90. He played a key role in the history of this program. A guest moderator and panelist, questioning newsmaker guests here in the late
1960s
and early '70s,
Monroe
became the fourth permanent moderator in November of
1975
...

MR. MONROE:Is that a proper minimum moral standard dictated by the
Bible
to apply to candidates?

Can't you have affirmative action without quotas and without preference?

Why would not
Iran
improve its position before world
public opinion
if the hostages were untied and they were permitted to be seen by neutral observers?

MR. GREGORY:Over his decade in the moderator's chair,
Monroe
put those questions to heads of
state
,
political power
players, and newsmakers the world over. But it was his
1980
interview with
President Jimmy Carter
here that had international repercussions.

MR. MONROE:Mr. President, assuming the
Soviets
do not pull out of
Afghanistan
anytime soon, do you favor the
U.S.
participating in the
Moscow Olympics
. And if not, what are the alternatives?

PRES. JIMMY CARTER:No. Neither I nor the
American people
would
support
the sending of an American team to
Moscow
with
Soviet invasion
troops in
Afghanistan
.

MR. GREGORY:Above all, it was his character and commitment to his craft that defined
Monroe
's career.

MR. MARVIN KALB:Every Sunday
with
Bill
has been a lesson in personal integrity and the highest standards of professional journalism. Good luck,
Bill
.

MR. MONROE:Thank you, sir.

MR. GREGORY:And we thank him for all his many contributions to this program.
Bill Monroe
retired from
NBC News
in
1986
. He died peacefully at a nursing home in
Maryland
on Thursday. He and his family are in our thoughts and prayers. That is all for today. We'll be back next week. If it's Sunday, it's
MEET THE PRESS
.

MR. DAVID GREGORY: This Sunday, from Wisconsin to Washington, the battle to rein in government spending is shaping up to be the major fight not only of this year, but of the 2012 campaign. As Wisconsin's Republican governor takes on the unions and orders Democratic lawmakers back to work, leaders in Congress are exchanging threats about a government shutdown if they can't agree on spending cuts.

MR. GREGORY: Where will it all lead? A special discussion this morning begins with two prominent voices of the Senate, Assistant Majority Leader Dick Durbin, Democrat of Illinois, and Republican member of the Budget Committee, Lindsey Graham of South Carolina.

Then, more on the budget battle and what it says about leadership in Washington after the president unveils a budget that fails to address the largest drivers of the country's debt.

(Videotape)

REP. PAUL RYAN (R-WI): Why did you duck? Why are you not taking this opportunity to lead?

PRES. BARACK OBAMA: This is not a matter of you go first or I go first.

(End videotape)

MR. GREGORY: Our roundtable weighs in: Former governor of Michigan, Democrat Jennifer Granholm; former congressman from Tennessee, Democrat Harold Ford; Republican strategist and former White House counselor to President Bush, Ed Gillespie; and the man credited with inspiring the tea party movement, CNBC's Rick Santelli.

Plus, the very latest on revolutions sweeping the Middle East. After Egypt, protests and violent crackdowns have spread to the gulf states. How will the administration balance U.S. interests with its interest in supporting democratic reforms? Our guest, the president's ambassador to the United Nations, Susan Rice.

Announcer: From NBC News in Washington, MEET THE PRESS with David Gregory.

MR. GREGORY: Good morning.

MR. DAVID GREGORY: And we will begin with those anti-government demonstrations that continue across the Middle East and North Africa. The governments of Libya, Algeria and Yemen each responding with violent crackdowns over the weekend. In Bahrain overnight, meantime, demonstrations have continued but state security forces have withdrawn,
leaving behind more jubilant protests. All of this being watched quite closely and with a sense of unease by rulers in neighboring Saudi Arabia. Joining me now, the U.S. ambassador to the United Nations, Susan Rice.

Ambassador Rice, welcome back to MEET THE PRESS.

AMB. SUSAN RICE: Thank you, David.

MR. GREGORY: Let me ask you specifically, as we go to the map, to talk about Libya. This appears to be the most violent crackdown where there isn't a whole lot that's actually known. In Benghazi, the eastern city, Human Rights Watch is reporting widespread government crackdowns, violent, the number of casualties unknown at this point. What can you say about what the U.S. government knows about what's happening inside Libya?

AMB. RICE: We're very concerned about the reports of violence and attacks on civilians. We've condemned that violence, David, and our view is that in Libya, as throughout the region, peaceful protests need to be respected. They need to be able to exercise their universal rights that people around the world share, and those rights include freedom of expression, freedom of assembly. And we will stand up in support of those universal rights everywhere.

In addition, David, what we're seeing across the region is a yearning for change, a hunger for political reform, economic reform, economic opportunity, greater representation. And we support that very strongly.

MR. GREGORY: All right, but let--we're going to get to that. But I want to--specifically in Libya, is Colonel Gadhafi killing protesters? Is he ordering his troops to go out there and violently crack down?

AMB. RICE: From what we can tell--and, as you know, the journalists are banned and...

MR. GREGORY: Right.

AMB. RICE: ...and we are relying on reports from Human Rights Watch and other observers--there has been less violence, very little so far in Tripoli, although that may be changing. In Benghazi, in, in the coastal areas, we're very concerned about reports of security forces firing on peaceful protesters.

MR. GREGORY: Let, let me ask you about Bahrain. We go back to the map and look at some of the scenes out of that country just over the causeway from Saudi Arabia, and also where the U.S. Fifth Fleet sits. The, the main center square in Manama, the capital, security forces have withdrawn from there. The United States has to be exerting a certain amount of
influence to get the government there to step back and step away from a violent crackdown.

AMB. RICE: Well, we've been very clear with our partners in Bahrain that they ought to exercise restraint, that there's no place for violence against peaceful protesters there or anywhere else, and we've condemned that violence. We've had outreach from President Obama, National Security Adviser Tom Donilon, Secretary of State Clinton and other senior officials, urging that restraint and encouraging what is now transpiring, which seems to be the pullback of the military forces and now a real effort to engage the opposition in a broad-based dialogue that will enable the people's aspirations to be discussed and, we hope, respected.

MR. GREGORY: Can the government as it now stands survive, in your view, in Bahrain?

AMB. RICE: Well, David, I wouldn't want to be in the business of predictions in, in this very volatile environment, as we've seen change so rapidly across the region. But what we're encouraging Bahrain and other governments in the region to do is to recognize that this is a
yearning for change and reform that is not going to go away, that it needs to be respected, and that they need to get ahead of it by leading rather than being pushed.

MR. GREGORY: You know, the, the--among our Arab allies, according to diplomats that I talked to, they criticize what they see as inconsistency on the part of the administration with regard to some allies vs. other allies, and then adversaries. The Economist magazine framed this very
difficult choice for the president this way, I'll put it up on the screen: "By his actions," the magazine writes, "in Egypt, Mr. Obama has put other authoritarian allies on notice ... He thinks that even pro-Western autocracies that fail to reform deserve to die. But how much
reform? And when will he decide they are dying? Will Mr. Obama abandon gradual reformers such as King Abdullah or King Mohammed as soon as enough people turn out on the streets of Jordan and Morocco? How many people are enough? To judge by the gale rattling the Arab world this week, he may have to answer such questions rather soon."

AMB. RICE: Well, David, for years, and indeed in--throughout the course of this entire administration, we have been saying to our friends and partners in the Arab and Muslim world that there needs to be a process for, for reform, that there are conditions that are inherently unstable: a youth bulge, high unemployment, a lack of political openness. And we
have pressed publicly and privately for the kind of change that is necessary. Now, we don't see this as, as antithetical to our interests. We support the legitimate aspirations of people all over the world, including in the Arab world, to have representative governments, to have
governments that respect their universal rights. And we don't see a dichotomy or a--an inconsistency between beginning to respond to those aspirations and our interests...

MR. GREGORY: But can't you see how our allies are confused about where we're going to push, where we're going to support reforms, or where we're going to push them out of power?

AMB. RICE: No. We've been very consistent across the region. The message is the same: No violence; respect the universal rights of people to assemble, to protest, to speak, to, to form political organizations; and, and, and get ahead of reform, recognize that there needs to be
lasting political change and lasting economic change.

MR. GREGORY: But you can't say it's been consistent.

AMB. RICE: It has.

MR. GREGORY: The, the president pushed Mubarak to leave office. He has not done that in Bahrain, he has not done that in Saudi Arabia, he has not done that in Jordan.

AMB. RICE: No, no, no. David, David, look, each of these countries is different. Each of these circumstances will be decided by the people of those countries. We are not pushing people out or, or dictating that they stay. What we're doing is saying consistently across the board there are universal, universal human rights that need to be respected. There are aspirations and, and demands for reform that are, are legitimate and need to be addressed very urgently.

MR. GREGORY: Let, let me follow up on Egypt. One of th big stories that has come out of there in the protests was what happened to our colleague from CBS News, Lara Logan, who was attacked by a mob, sexually assaulted, according to CBS News. And I know that the administration has been pressing the Egyptian military and the government to get to the bottom of this. Are you satisfied that you have any real answers as to what was behind this?

AMB. RICE: David, first of all, we're all horrified and outraged by what seems to have been a horrific attack against Lara Logan, and we've condemned it. And we are doing everything through our embassy and with the Egyptian authorities to ensure that, that we know as much as can be known about this, and that those who are responsible are held accountable.

MR. GREGORY: But no answers yet that you're satisfied with?

AMB. RICE: Not--no, not yet.

MR. GREGORY: Let--the, the other question in Egypt--and again, where criticism comes from our allies--is that the U.S. publicly and privately pushed Mubarak to go without a real sense of what would come next in terms of democratic reform, even a democratic process, since there's not an identified opposition leader as of yet. The USA Today reported the presence of the Muslim Brotherhood, the most organized opposition force, and they write this: "In the scramble for power among groups of various political identity after last week's ouster of Mubarak, the
Brotherhood--an Islamist group that has held as many as 20 percent of the seats in Egypt's parliament in recent years--is vowing to increase its influence on daily life in Egypt.

"The Brotherhood would seek `the preservation of honor' by stoning adulterers, punishing gays, requiring Muslim women to cover their heads and shoulders in public and killing Muslims who leave their faith, said [Brotherhood spokesman] Abdel Fattah, whose forehead bore the calluses of those who prostrate themselves five times a day in prayer."

If the Brotherhood becomes a dominant part of Egyptian--of the Egyptian government, is the United States prepared to do business, to do business with them as an ally that Egypt now is?

AMB. RICE: Well, first of all, there's no indication that the, the Brotherhood is going to dominate Egyptian politics. What you saw on the streets, and what we saw as recently as Friday in Tahrir Square, is a incredibly diverse cross section of Egyptian society, largely ecular,
seeking the same sort of reform--male, female, religious, secular, young, and old. This is a cross-cutting movement for change. And we have confidence that if the democratic processes are respected, if there is time for parties to form, if there's an opportunity for civil society to organize, if the constitution is amended as it needs to be and there's freedom of expression, that the Egyptian people will responsibly choose new leadership and we will look forward to working with the democratic Egypt.

MR. GREGORY: You're saying that the Brotherhood should not be feared.

AMB. RICE: David, what I'm saying is we have faith in the people of Egypt, and we have faith in democracy, and we believe in allowing democratic institutions to take root and to flourish. That's our aim in Egypt. We're going to support that. And we believe it needs to be credible and irreversible.

MR. GREGORY: Before you go, I want to ask you about the, the U.N. vote on a resolution brought forward by the Palestinians to declare Israeli settlement activity as illegal. You, as the United States representative there, vetoed that measure because of the word "illegal." The
administration believes that settlements are illegitimate, but not necessarily illegal. My, my question is whether you worry that in the middle of all this protest, the administration has now angered enough Arabs in government and on the street by taking on this issue in this way?

AMB. RICE: Well, first of all, David, we vetoed the resolution not only because of the word illegal, but because our view is that we need to get the parties back to direct negotiations so that they can agree through direct talks on a two-state solution. That's the goal.

MR. GREGORY: Mm-hmm.

AMB. RICE: And the problem with this resolution is it was one-sided, and it was designed--not designed, but it would have had the impact of hardening one or both sides and making it much harder for us to get them back to the table. So we have our eye on the big prize. Yes, for over four decades it has been U.S. policy to oppose settlement activity. We view it as illegitimate and corrosive to the peace process. I made that point clearly in our statement after the vote. But the aim, David, is to achieve an independent, viable Palestinian state living side-by-side next to a Jewish state of Israel. That's what we're going to continue to work
to achieve. And, and we look to the parties to demonstrate their commitment to that goal and to take the important steps that need to be taken to build confidence and trust towards that end.

MR. GREGORY: All right, Ambassador Rice, we're going to leave it there this morning. Thank you very much...

We focus now on the battle over government spending that is taking place, as I mentioned, from Wisconsin to Washington and beyond. Joining me now two prominent voices in the Senate: the Assistant Majority Leader, Dick Durbin, the Democrat of Illinois, and Republican member of the Budget Committee, Lindsey Graham of South Carolina.

Welcome to both of you.

Senator Graham, I do want to start with you and just follow up on one point about what's happening in the Middle East. As Ambassador Rice suggested, so much concern about the nature of the crackdowns in certain countries now. Are you satisfied with any measure of consistency you see from the administration in terms of how they are using their influence
against various countries?

SEN. LINDSEY GRAHAM (R-SC): Well, the one, one suggestion I would make is we've been very inconsistent and too timid when it comes to Iran. They've done a good job in Egypt. I think we should have a policy of urging old friends to do better in replacing old enemies. So I'd like to
see regime change in Libya. I'd like to see regime change in Iran. I think we need to be tougher on companies that do business with Iran. But, generally speaking, the administration, I think, has handled Egypt well and is trying to stay ahead of this when it comes to Jordan,
Bahrain, and Saudi Arabia.

MR. GREGORY: All right. There's so much to get to on the budget. Senator Durbin, I want to go there immediately. It's interesting, here, here is the president's budget for next year, and yet the fight hasn't even started over this because Congress is still fighting about this
year's money, funding the government for this year. A dramatic House vote over the weekend and here was a summary in The Washington Post, that I'll put up on the screen. "The House approves dramatic cuts in federal spending, 235-189. The Senate is expected" the Post goes on, "to take up its own version of the spending measure the first week of March, just before a March 4 deadline for when the current funding resolution expires. With Democrats pushing to keep spending at 2010 levels for the remainder of this year, the two sides begin a grueling negotiation process more than $61 billion apart."

Senator Durbin, are we heading towards some kind of government shutdown?

SEN. DICK DURBIN (D-IL): I certainly hope not, and we've made it clear from the start that that is the worst outcome. If we end up shutting down the government and calling into question whether we're going to meet our obligations for Social Security checks and paying our troops, then that is an absolute, utter failure. We can do better. And I think we need to sit down in a positive, constructive way and work out our differences. There are differences. But the starting point is that we know we need to cut spending, we know we need to live within our means. And we believe that we can find a way to do this for the remainder of this fiscal year.

MR. GREGORY: But how does this get resolved? Here was Senator Reid, the majority leader, Senator Graham, talking about the House, you know, passed their end of it and now there's not a lot of time to negotiate. Speaker Boehner saying, "Read my lips: We're going to cut spending," and this is how Senator Reid responded.

(Videotape, Thursday)

SEN. HARRY REID (D-NV): And now he's resorting to threats to do just that without any negotiations. That is not permissible. We will not stand for that. He's wrong.

SEN. GRAHAM: The only way we'll shut the government down is if our Democratic colleagues insist on keeping the federal government large and unsustainable. From 2008 to 2010 the federal government in non-defense discretionary spending grew about 24 percent. Very few people in America had that increase in their budgets. And if you count the stimulus, over
80 percent increase in spending. What I hope to happen is that we'll find a way to resolve this by reducing spending in a bipartisan fashion. The House members did exactly what they campaigned on. The Democratic House was fired because they spent too much. There will probably be a temporary CR, but it should have some spending cuts as a down payment on
controlling the size of our federal government.

MR. GREGORY: But you're suggesting compromise, some spending cuts. You're suggesting Republican leaders in the House have got to be able to compromise because the Senate's not going to pass what they just passed.

SEN. GRAHAM: The, the, the, the only reason I'm suggesting is that we do a temporary CR for a week or two is we just don't have enough time. But I won't support a CR unless it has some spending cuts.

MR. GREGORY: Right.

SEN. GRAHAM: But I'm going to side with the House when it comes to getting back to 2008 spending levels. That's what they campaigned on. They're just doing what they promised the American people. And getting back to 2008 levels I think is a good start. And we got a lot more to do than just that.

MR. GREGORY: So, just so everybody knows, a CR is a continuing resolution, which is a way to fund the government for the rest of the year.

Senator Durbin, where do you see room for compromise here? Are, are your--you, as leaders, in, in--on the Democratic side in the Senate are going to have to, to move a bit on cutting dramatically government spending.

SEN. DURBIN: David, understand the starting point. We've already cut $41 billion below the president's budget for this fiscal year in this--the way we're currently funding our government. And now the question is: How much further should we go? And there are serious questions to be answered.

MR. GREGORY: There's--the $41 billion is just less than the level that it was funded at before.

SEN. DURBIN: No, it's less than the amount asked for by the president for this year, $41 billion below it, and the House has gone $100 billion below it. And so let's be very candid, both sides have made cuts. The question is: What is the right thing to do at this moment? The deficit
commission took a look at our economy and said, "Be careful. Make sure that you move towards fiscal solvency for the United States, but do it in a fashion that will not harm the growth of our economy." You can't reach a budget balance with 15 million Americans out of work. We need to invest in things that count: Education and training for our workers; innovation so that we have that kind of spark of creativity that creates new businesses and new jobs; and investment in the infrastructure of America, building things that are going to make us strong for generations to come.

MR. GREGORY: But...

SEN. DURBIN: If I have anything to fault with the House approach to it, I think they went too far in their cuts.

MR. GREGORY: Let me ask you about what is becoming a federal issue, and that is what's happening in Wisconsin. This was the scene on Friday in the rotunda in Madison as union workers were protesting the move by the governor of Wisconsin to demand a greater participation on unions in terms of pension contributions, as well as health care contributions,
also trying to end collective bargaining in the state. And you see the response there. President Obama did an interview and weighed in on this. This is what he had to say.

(Videotape, Wednesday)

PRES. BARACK OBAMA: Some of what I've heard coming out of Wisconsin, where you're just making it harder for public employees to collectively bargain generally, seems like more of an assault on unions. And I think it's very important for us to understand that public employees, they're our neighbors, they're our friends.

MR. GREGORY: Senator Graham, did the president do the right thing weighing in to this controversy?

SEN. GRAHAM: I think the president should be focusing on what we're doing in Washington. The president's budget this year is the highest level of spending as a nation--25.3 percent of GDP--since World War II. So that's not the number to use to get this place in, in, in fiscal
sanity. We should be looking at the dollars we're actually spending. That's what the House did. But when the president talks about Wisconsin, I think that's--that really is inappropriate. The governor of Wisconsin is doing what he campaigned on. He said he would ask contributions from government employees for pension and for health care at a level that I think is reasonable. And he also put on the table renegotiating and reforming collective bargaining. He told me yesterday it takes 15 months to do a contract with government employees in Wisconsin. And so he's doing what he said. There was an election on his proposals, and he won, and he should be allowed to fulfill his mandate just like the House Republicans.

MR. GREGORY: Senator Durbin, is the White House, is the president, using his own campaign operation, an operation of supporters, to fuel protests in Wisconsin?

SEN. DURBIN: Let me tell you why what's happening in Wisconsin, just north of Illinois, goes way beyond the discussion of the Wisconsin budget. If you think this is just about money and the budget, then you might believe Cesar Chavez was just working to get a couple pennies more per pound for grapes or that Martin Luther King was really working for access to hotels and restaurants. There's a much bigger issue at stake here. For over 80 years in America, we have recognized the rights of our workers to freely gather together, collectively bargain, so that they could have fairness in the workplace and fairness in compensation. And that is what's at stake here. It goes way beyond this budget issue. This governor of Wisconsin is not setting out just to fix a budget, he's setting out to break a union. That is a major move in terms of American history. I believe the president should have weighed in. I think we
should all weigh in and say, "Do the right thing for Wisconsin's budget, but do not destroy decades of work to establish the rights of workers to speak for themselves."

SEN. GRAHAM: David, if I could just add, this is a campaign flier I have--I don't know if you can see it--from the last election cycle where Wisconsin unions said, "If you elect this guy, Scott Walker, he's going to reform or limit collective bargaining." He was open about what he was going to do about contributions to pensions and retirement, and he told the people of Wisconsin, "I'm going to change collective bargaining because it is--impedes progress when it comes to education. It's too hard to fire anybody, it is too complicated. And I'm going to change that system." So, in a democracy, when you run on something, you do have an obligation to fulfill your promise. He didn't take anybody by surprise. He's doing exactly what he said. There was a referendum on this issue, and the unions lost. And the Democrats in Wisconsin should come back to Wisconsin to have votes.

MR. GREGORY: All right. Let me, let me take a break here. We're going to come back, talk more about the president's budget and the question of leadership in Washington on the biggest drivers of our nation's debt. More with Senators Durbin and Graham in just a moment.

(Announcements)

MR. GREGORY: Coming up, more with Senators Durbin and Graham. Can both parties come to an agreement on spending or will there be a government shutdown? Up next, after this brief commercial break.

(Announcements)

MR. GREGORY: We're back, joined again by Senators Dick Durbin and Lindsey Graham.

And, Senator Durbin, you mentioned the debt commission, the president's debt commission on which you served, and you supported its findings. They're out with an op-ed in The Washington Post today about the president's budget. And this is, in part, what they had to say. "To be sure, the president's budget doesn't go nearly far enough in addressing the nation's fiscal challenges. In fact, it goes nowhere close." This was a president, Senator Durbin, who said, during the transition, that we cannot kick the can down the road when it comes to entitlement spending, the biggest drivers of our nation's debt. And yet he chose not to do so in this budget. Why?

SEN. DURBIN: Well, let's give credit where it's due. The president's budget will freeze spending and, over the course of five years, is going to reduce our, our, our deficit by some $400 billion. We'll see domestic discretionary spending at the lowest level, as a percentage of GDP, since President Dwight David Eisenhower. It is a step in the right direction, and it's consistent with the first two years the deficit commission recommended. Now, as a member of the commission, I will tell you we went beyond that. We said, "After the first two years, we've got to have a 5 percent reduction in spending the first year, and then half of, of the cost of living increase reduction for the next seven years." So we do achieve more through the deficit commission.

Now, David, the good news is this: There are six of us, three Democrats and three Republicans still meeting, looking at the deficit commission as a template or as a goal, and trying to find a way to work together in a bipartisan fashion in the Senate to come up with a reasonable way to deal with this deficit. We can build on the president's budget into deeper cuts, but we need to put everything on the table, with the exception of Social Security, which I'd like to mention. Everything else needs to be on the table. The House, in their budget, just dealt with 12 percent and made a dramatic cut in our budget of 12 percent in domestic discretionary. I might say...

MR. GREGORY: But, but, but, Senator, it's--everything is not on the table. I mean, the point is you're talking about--you're heralding 12 percent of the budget. That's not where the big--that's not where the money is here when it comes to driving up the debt. You even said about
the debt commission that the president probably doesn't want to wear that collar into the next election. I've talked to administration officials who say the strategy here is a political one: Get the Republicans to step forward first, make the big suggestions on where to cut entitlements, and then that could be used against them in the election.

SEN. DURBIN: Well, David, let me tell you, after we get beyond who goes first and bragging rights about who cuts the most, the bottom line is: Can we reach an agreement on a bipartisan fashion with senators of both political parties and move forward? What the president has said, he's open to this conversation. I'd like to say one word about Social Security from my point of view.

MR. GREGORY: Well, let me just hold that. I want to get Senator Graham's response on this question of whether the president is making good on his promise to lead on this issue.

SEN. GRAHAM: Well, it's clear to me that he, he did not lead in the State of the Union. This budget does nothing, his budget does nothing on entitlement spending, and we all know that's where the money's at. It's a politically timid budget, it's a fiscally timid budget. It goes
nowhere near where the debt commission went. It was $4 trillion over a decade. It allows the debt to double in four years, then triple by 2019. It's just not the document we need to keep from becoming Greece. The debt commission, if given life, can change this country.

And to Senator Durbin, you have my undying respect and gratitude for working with Republicans and Democrats to vote on a document that is a blueprint to save this country from fiscal collapse. Forty cents of every dollar we spend, we borrow. And in 20 years from now, all of the money we have in revenue going to go to pay the debts Social Security, Medicare and Medicaid, nothing left for the national defense, homeland security, etc. So Dick, let's do something about the tax code. Let's flatten it out, do away with all deductions except home interest and charitable giving. Let's be bold when it comes to Medicare. And let's
put Social Security on the table in a rational way, like Ronald Reagan and Tip O'Neill did. There's no reason not to adjust the age over time for people under 55 to 69 or 70. You and I can afford some means testings to our benefits. That will save Social Security from
bankruptcy. It's headed toward across-the-board cuts in 20 years. So I applaud what you're doing with the other senators, but let's do put Social Security on the table. Me and Senator McCain are going to work on a solution. I'd like to share it with you.

MR. GREGORY: Senator Durbin?

SEN. DURBIN: David, if I could say this about Social Security.

MR. GREGORY: Yeah.

SEN. DURBIN: I--first, I want to thank my colleague for the kind words. Social Security does not add one penny to the deficit. Social Security untouched will make every promised payment for more than 25 years. But the deficit commission was given a charge, add 75 more years of solvency to Social Security. It came up with an approach. I think, frankly, another commission, Pete Domenici and Alice Rivlin's commission, came up with a better approach. We need to move on Social Security, but let's put it on a track that runs parallel but separate to deficit reduction. The Social Security program, as it's currently put together, does not have
any impact on the deficit.

MR. GREGORY: ...few people believe that there's not an arithmetic problem with Social Security.

SEN. GRAHAM: You know, when I was 21 and 22, my parents died, I had a 13-year-old sister. I was in law--college in law school. If it weren't for survivor benefits coming to my sister from my parents' contribution, we would have had a hard time making it. Today I'm 55, I don't have any kids. You know, we're, we're paying more in benefits than we're collecting in taxes in about five years. In 2037, maybe even sooner, you have to cut benefits by a third across the table. All I'm suggesting is let's do with Social Security what Ronald Reagan and Tip O'Neill did.
Let's get it in a sustainable glide path. You know the age has to be adjusted for all entitlements, including Medicare. To go 67 to 69 like Reagan and Tip O'Neill did, for people under 55, is amenably doable.

MR. GREGORY: All right.

SEN. GRAHAM: And it does help our long-term debt. To take it off the table and, and--is just the wrong thing to do. And, and it's just very disappointing.

MR. GREGORY: All right. We're going to have to leave it there. More of this debate ahead, for sure. Thank you both very much.

And coming next, budget battles in Washington and in state capitals across the country. We've been talking about all eyes on Wisconsin this week as government workers protestered--protested, rather, and state legislators walked out. Will other states now follow? And the president came under fire from Republicans for not being bold enough in his own budget. Is the budget blueprint a failure of leadership or a political power play eyeing the 2012 elections? Our roundtable weighs in: former Michigan Governor Jennifer Granholm, former Congressman Harold Ford, Republican strategist Ed Gillespie, and CNBC's Rick Santelli.

(Announcements)

MR. DAVID GREGORY: We are back, now joined by our roundtable: Republican strategist, former White House counselor to President Bush, Ed Gillespie; CNBC's Rick Santelli; former congressman from Tennessee, Democrat Harold Ford; and former governor of Michigan, Democrat Jennifer Granholm, who left the statehouse last month and who, we're pleased to
say, will be joining us on a regular basis as a contributor to our roundtable.

Well, there is so much to talk about, and it's--as I said at the top of the program, from Wisconsin to Washington it is this fight about reining in government spending. So here it was, look at this picture, the sea of red. Union protesters in the rotunda in Madison, Wisconsin, over the move by Governor Walker to take on the unions. And this battle is ongoing. This is how The New York Times reported it on Saturday, to kind of frame the issue: "The images from Wisconsin - with its protests, shutdown of some public services and missing Democratic senators, who fled the state to block a vote - evoked the Middle East more than the Midwest.

"The parallels raise the inevitable question: Is Wisconsin the Tunisia of collective bargaining rights?"

Governor Granholm, what is at stake here?

GOV. GRANHOLM: Well, I don't think anybody disagrees that there has to be cuts. And I don't, I don't hear anybody on either side saying that there shouldn't be. And the, the, the workers on Friday said that, "We'll accept the contributions to the pension. We'll accept the
contributions to health care." So given that the governor has already gotten them, what he sought to do to resolve his budget problem, what is this really exposed to be but an attack on collective bargaining? And so I, I love--we were talking earlier, I love the smell of democracy. It's so inspiring that so many people feel moved to come out and express themselves. But this is--this in Wisconsin, make no doubt about it, the, the--everybody understands that cuts need to happen. But this is really about collective bargaining.

MR. GREGORY: But, Ed Gillespie, is this then open season on the unions by a Republican governor? Is that what this is about? That's what the president said.

MR. ED GILLESPIE: Well, I was interested to see the president insert himself into the Wisconsin budget debate. And I tend to agree with Lindsey Graham, not surprisingly, that he might want to focus more of his attention on trying to get control of federal spending in Washington.
But look, right now what Scott Walker, the governor of Wisconsin, is proposing is that the members of the unions in, in the public employee unions in Wisconsin vote every year to validate their, their union participation. That is democracy. Empowering the worker to make a determination as to whether or not they want to contribute these compulsory union dues or not makes a lot of sense. And that's really what this is about. The, the labor unions want to lock people in, you know, as soon as they get a job, where they don't really have a choice as
to whether or not they can vote for, for having union representation or not. I, I think democracy's a good thing. We ought to have more of it.

MR. GREGORY: Harold Ford, look at the numbers from 2008 in Wisconsin in the presidential race. This was a state that the president carried 56 to 42; a swing state, you wouldn't know it by those numbers. But more Republicans, certainly in the midterm election, had strong gains. And make no mistake, the president has now elevated Governor Walker there in Wisconsin. This is about energizing unions. This is the core of the Democratic Party. And this is going to be a big issue now.

FMR. REP. HAROLD FORD JR. (D-TN): It's become more political, or as much political as it is substantive, around the budget. The president obviously wants to hold onto his base, energize that base for the next year's election. Scott Walker and the tea party is understanding their
argument. But I think it's important to understand that you can't look at all of these states as one. The governor touched on it very well. This issue in Wisconsin deals with whether or not public employees ought to pay into their health insurance program, which they don't now, and to their pension program, which they don't. The unions have agreed to do this. This has now become--and I think President Obama was right in his description of it--it's questionable whether or not he should have gotten into it--but this has now become an assault on unions and the ability to organize in Wisconsin. I'm hopeful that the governor, if he's serious
about the math, which he obviously is, that he will take the unions at their word, saying, "We are now prepared," which is the right thing to do. In other states where public employees are not doing this, they should use this as a model. But to, to say that collective bargaining
ought to be ended, I'm uncomfortable with that. And I think Republicans, particularly Scott Walker, may find himself in an overreach position if he, if he continues that line.

MR. GREGORY: But, Rick Santelli, why not just take them at their word that they were willing to accept these provisions, but leave collective bargaining alone?

MR. RICK SANTELLI: Well, I think that has implications for some of the local governments in Wisconsin, and I also think that, you know, I'm not a collective bargaining expert, but even going back to FDR, there's always been issues as to the sustainability and the appropriateness of having collective bargaining when it comes to the public employees. And I think this is an issue that needs to be put out into the air and see--many, many other states, ultimately, might have--not have the same balance sheet as Wisconsin, but I think, ultimately, collective
bargaining, even from a federal l evel, these are big issues, and these costs need to be put under control. If the country is ever attacked like it was in 9/11, we all respond with a sense of urgency. What's going on on balance sheets throughout the country is the same type of attack.

MR. GREGORY: Well, let me pick up on that.

Governor Granholm, the national conversation is about how to rein in government spending.

GOV. GRANHOLM: Right.

MR. GREGORY: Republicans, they won in November. They are now owning this conversation, it seems, more than President Obama and the Democrats are. Is that a problem politically?

GOV. GRANHOLM: I think it's clear that the Democrats want to rein in spending, but they don't want to damage the economy. The whole point is, you know, I think there is a real overreach with respect to the interpretation of the November results. The November results, sure, some
people voted the way they did because they wanted to cut everything out of government. But most people, I would venture to say, did it because they were uncomfortable with the fact that the unemployment rate is high, that this is about jobs and the economy more than it is about the deficit. You slash too much, you hurt jobs and the economies. So where's that balance? And let me just jump back for one thing on Wisconsin.

MR. GREGORY: Mm-hmm.

GOV. GRANHOLM: On--you know, there are states in this country that have massive deficits that don't have collective bargaining, and there are states that have very low deficits that do have collective bargaining.

REP. FORD: That's a great point.

GOV. GRANHOLM: That is not the issue. The--if you want to have a discussion about collective bargaining, have that. But this is about deficits. And I can just tell you, as governor of Michigan over the past eight years, I cut more out of state government that--as a percentage, per capita, than any state in the country. Every single year we had to cut. In fact, I--by a large percentage. And I did it in partnership with the unions. Our unions gave over $700 million in concessions. I asked them to pay the new employees 20 percent toward their healthcare benefits. They don't even have a pension. They have 401(k)s. They have
a defined contribution plan and not a defined benefit plan.

MR. GILLESPIE: All right. Well, let me end with this, which is we're not talking about eliminating collective bargaining, what we're talking about is limiting collective bargaining to wages, not the benefits package...

MR. GREGORY: Right, right.

MR. GILLESPIE: ...and having the union members vote themselves every year whether or not they want to continue that.

MR. GREGORY: Let me, let me continue on this theme about who's kind of winning the, the austerity conversation. The president was pressed during a news conference this week about why not move forward and, and, and stop kicking the can down the road and present in his budget cuts to entitlement programs. This is what he said about the need to work together.

(Videotape, Tuesday)

PRES. BARACK OBAMA: This is not a matter of you go first or I go first. This is a matter of everybody having a serious conversation about where we want to go and then ultimately getting in that boat at the same time so it doesn't tip over. And I think that can happen.

(End videotape)

MR. GREGORY: The reality is, talking to administration officials, Harold, they want the Republicans to go first. They want them to propose big entitlement cuts so they can, some, frankly, demagogue them come election time. Is that leadership?

REP. FORD: I'm not convincing it's winning--I'm not convinced it's winning leadership. I'm a believer that a president looks strongest and best in mid-November to the end of December when he brokered a tax deal, an extension of the tax cuts. He was able to broker an extension, or I should say a rewriting of the START treaty. Allowing all Americans, regardless of their sexual orientation, to serve openly in the military, that was leadership on the president's part that allowed that to happen. I think they have to show the same kind of leadership on this front. If not, you run the risk of allowing a conversation that you believe in,
hoping that concessions is--and such, is coming from unions in different states happen, but another conversation around collective bargaining and an assault on unions taking a course and a direction you don't want. If the president leads on reducing spending, particularly entitlement spending, it's not much. You listen to Lindsey and you listen to Scott--I mean, Dick Durbin, they both have said Social Security ought to be on the table.

REP. FORD: If the president leads on this front, I happen to believe he will benefit politically. But more important, the country will benefit in the long term. I'm 40. I'm willing to give up my benefits till I'm 70 and even have them means tested after that point because of the
blessings that have come my way as an American. And I believe there are more like me. And I believe the president and Republicans would, would find to lighten that.

MR. GREGORY: Well, let me--let me flip this around, Rick Santelli. Why shouldn't a Democratic administration, this president, say, "Let's see what the Republicans are willing to do." OK? "I went out big on health care and they weren't there. They demagogued me. Why not see what they're willing to propose and see if we can structure a grand bargain, because I haven't had much success in actually working them, if we want to get something done." What's wrong with that approach?

MR. SANTELLI: Well, I think what's wrong with that is this past week we just had the two-year anniversary of the original stimulus package. So there are issues regarding spending that have been here through the entire administration. And I think, at this point, the politics--and
there's always going to be political gamesmanship, especially with such a key election coming up in 2012. But this is a time, as Congressman Ford has said, that whoever owns this argument, the public is going to get it. It's not going to be easy. Pulling a dollar out of anybody's pocket is not going to be something where people are going to be raising their hands to volunteer. And it's--we're going to get there anyway. I think the president ought to be aggressive and be a true leader and step out on this issue.

MR. GREGORY: All right. We're going to take a break here. We'll come back, talk more about this leadership question on the budget, but also the politics of 2012, deeply impacted by this very debate. More with our roundtable right after this.

(Announcements)

MR. GREGORY: We are back with our roundtable.

Governor Granholm, we've been talking about the, the big picture, political leadership question. But the pressing issue is the prospect of a government shutdown over spending cuts this year in Congress. Who wins, who loses in this situation?

GOV. GRANHOLM: I think it is a lose-lose. I've been--I've seen this movie, I've been in it. We...

MR. GREGORY: Right. A couple of times as governor.

GOV. GRANHOLM: Yes. In fact, in 2007. But this is the--you will be rewarded in this way. You will be in the cellar of American esteem, both sides. It's a pox on all your houses. People at home sit there and go, "What the heck just happened? I sent all these people to Washington to fix things, and they shut it down."

MR. GREGORY: You've been inside the room, not for this particular kind of thing. But, you know, you know Speaker Boehner well. You've worked with him when you were in, in the White House. He may want to make a deal, I would think, but he also said, "Hey, you know, don't look at me, I'm just the speaker." He has a pretty restive base here he's got to deal with.

MR. GILLESPIE: Well, a couple things. First of all, they passed their continuing resolution in the House.

MR. GREGORY: Yeah.

MR. GILLESPIE: The only way you don't, you know, the, the House can shut down the government is by not moving forward a continuing resolution, which they have. The Senate, under Democratic leadership, has yet to do so, and they're out all next week. So there's a little bit of chicken being played here by, by Senator Reid.

MR. GREGORY: Yeah.

MR. GILLESPIE: And then the second this is, you know, they talk about "We're going to freeze spending." We're--they're going to freeze spending after a 24 percent increase in federal discretionary spending. That's like gaining 24 pounds over Christmas and saying "My new year's resolution is I'm going to keep it. I'm not going to lose any of it, I'm not going diet it off. I'm going to keep it right there." That is not what the voters are saying. And the fact is, we talked about economic growth, the most--the biggest drag on economic growth is this looming debt, and that--not looming but mounting debt that is causing a problem in the, in the credit markets and is causing a sense amongst voters of uncertainty. And the Republicans in Congress are trying to address it, the administration's not.

MR. GREGORY: It's interesting, Harold, because the president in the State of the Union tried to say, "Look, we need to deal with the debt, but we've also got to win the future. We've got to get the balance right between austerity and investment." But the conversation is really about
how much austerity are you going to support? Is he losing ground here?

REP. FORD: No. I think if, in the coming weeks, in the coming days, you don't see a kind of spirit that Governor Granholm just, just suggested that shutting down government is bad for both sides, the president's got to lead on that front. I'd say one other thing. I was in Congress in--from '96 to 2006 and there was a belief that the budget could not be balanced, that the debt was going to continue rising. Every politician would go to the floor and bemoan we're going to have deficits as far as the eye can see. The Congress balanced the budget under--with a Congress and a president named Clinton that really worked hard to get it done. Westarted to grow again, and we found ourselves in a position where we were taking in more money than we were spending. So we can get out of this mess. The president's message of winning the future is the right one. But, unfortunately for the president, the politics is around deficit reduction right now.

MR. GREGORY: Yeah, right.

REP. FORD: People want jobs created, without a doubt. And Republicans better be careful because if they focus too much on this and jobs aren't created they will be punished. But right now, at the moment, people want to see government, like themselves, tightening their belt, getting responsible, being held accountable, and doing things that just seem sensible. Social Security is a sensible thing to do. Cutting part of the spending is a sensible thing to do.

MR. GREGORY: Right.

REP. FORD: And hopefully my party recognizes that.

MR. GREGORY: And you're teeing up--Governor Chris Christie of New Jersey, talk about austerity. He gave a speech here in Washington this week that got rave reviews in part because of his plain language about taking on issues like Social Security. Here's what he said.

(Videotape, Wednesday)

GOV. CHRIS CHRISTIE (R-NJ): You're going to have to raise the retirement age for Social Security. Ho, ho! I just said it, and I'm still standing here. I did not vaporize into the carpeting, and I said it.

(End videotape)

MR. GREGORY: He didn't vaporize into the carpeting, Rick Santelli. I mean, this is the kind of plain talk that people are responding to. And yet, you just heard from Senator Durbin, you know, they want to take Social Security off the table right now in terms of dealing with that
debt reduction.

MR. SANTELLI: Senator Durbin is from my state: 3.7 billion Muni issuance that they need to bring to the market. They haven't paid vendors. You know, it has come to the crossroads where if we don't start to make the changes that the governor and the congressman know are going to take time, we will have austerity forced on us, and that type of austerity is going to be much messier. There really isn't much opportunity for debate here. We do need action. And even though the interest rates on the federal side haven't moved markedly higher, a lot
of the assumptions for these outlier years for the deficit are assuming fairly good behavior on interest rates and a fairly robust economy. And when the Clinton years came forth with all the jobs and a surplus, we were in a much different economic time. We had an industrial computer
revolution going on in California, you had the wall fall in the late '80s that freed up an inordinate amount of peace dividend money. Our economy is not nearly as aggressive at this time around.

MR. GREGORY: But, Ed Gillespie, look at the politics of this. This was some polling out of New Hampshire, which will be the, the first primary state in 2012 after the Iowa caucuses, and here's how it looks on the GOP side. It's Romney leading there commandingly, and he even looked good at this early juncture head-to-head against President Obama. My question though, Ed, is whether or not Republicans are looking at all this and saying, "Look, we got to own the budget message, yes." But are they worried that Republicans overreach here, which is what, of course, the, the Democrats and, and the White House are counting on?

MR. GILLESPIE: I don't sense that right now, David. I've never seen a political environment, and particularly on the Republican side, but generally as well, where there is a greater risk to be seen as unwilling to cut spending than there is to be cutting spending. I've never seen a
dynamic like this like we see right now. And again, that's why I think President Obama's out of touch. I mean, you know, Amtrak loses $1 billion a year. He's proposing $53 for high-speed rail in his budget. We're not losing money fast enough? We got to lose it at a faster rate?
It is--they--there's a disconnect here that I think is going to cost him in 2012.

MR. GREGORY: OK. All right, I, I got to--I got to leave, I got to leave it there. Thank you all very much.

MR. DAVID GREGORY: I wanted to save a little time because before we go we do want to remember NBC newsman and former moderator of MEET THE PRESS, Bill Monroe, who died this week at the age of 90. He played a key role in the history of this program.

A guest moderator and panelist, questioning newsmaker guests here in the late 1960s and early '70s, Monroe became the fourth permanent moderator in November of 1975...

(May 21, 1978, to Jesse Jackson) Can't you have affirmative action without quotas and without preference?

(December 9, 1979) Why would not Iran improve its position before world public opinion if the hostages were untied and they were permitted to be seen by neutral observers?

(End videotape)

MR. GREGORY: Over his decade in the moderator's chair, Monroe put those questions to heads of state, political power players, and newsmakers the world over. But it was his 1980 interview with President Jimmy Carter here that had international repercussions.

(End videotape, January 20, 1980)

MR. MONROE: Mr. President, assuming the Soviets do not pull out of Afghanistan anytime soon, do you favor the U.S. participating in the Moscow Olympics. And if not, what are the alternatives?

PRES. JIMMY CARTER: No. Neither I nor the American people would support the sending of an American team to Moscow with Soviet invasion troops in Afghanistan.

(End videotape)

MR. GREGORY: Above all, it was his character and commitment to his craft that defined Monroe's career.

(End videotape, September 9, 1984)

MR. MARVIN KALB: Every Sunday with Bill has been a lesson in personal integrity and the highest standards of professional journalism.

MR. GREGORY: And we thank him for all his many contributions to this program. Bill Monroe retired from NBC News in 1986. He died peacefully at a nursing home in Maryland on Thursday. He and his family are in our thoughts and prayers.

MR. DAVID GREGORY: That is all for today. We'll be back next week. If it's Sunday, it's MEET THE PRESS.

First ‘Meet the Press’ photo

December 4, 1947: The earliest photograph in existence of the longest running television program in history. Sen. Robert Taft was the guest on "Meet the Press" that day, less than a month after the program debuted on NBC television at 8 p.m., November 6, 1947. James A. Farley, the former postmaster general and former Democratic National Committee chairman, was the guest on the first broadcast.
(Meet the Press)
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Billy Graham

March 6, 1955: Rev. Billy Graham’s first "Meet the Press" appearance. He tells panelist (and program co-founder) Lawrence Spivak "anything that makes any race feel inferior ... is not only un-American but un-Christian."
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Jackie Robinson

April 14, 1957: Jackie Robinson, the first man to break the racial barrier in Major League Baseball, also becomes the first athlete to appear on "Meet the Press." Robinson joins moderator Lawrence Spivak in a discussion about civil rights and Robinson’s work with the NAACP.
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Eleanor Roosevelt

October 20, 1957: Former First Lady Eleanor Roosevelt in one of her six "Meet the Press" appearances. Here she talks about her trip to the Soviet Union.
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Robert Frost

December 28, 1958: Poet Robert Frost was introduced by moderator Ned Brooks as "the poet of all America. Indeed, it can be said that he is the poet of all mankind." Two years later, Congress awarded Robert Frost a gold medal in recognition of his poetry, saying it enriched the culture of the United States and the philosophy of the world.
(Meet the Press)
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Fidel Castro

April 19, 1959: Cuban Prime Minister Fidel Castro appears on "Meet the Press" during his first visit to the United States since the revolution. Castro was annoyed that permanent panelist and producer Lawrence Spivak would not allow him to smoke cigars in the studio.
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Martin Luthur King Jr.

April 17, 1960: Civil Rights leader Dr. Martin Luther King Jr., pictured here in one of his five "Meet the Press" appearances.
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John F. Kennedy

October 16, 1960: After this interview, then-Senator John F. Kennedy calls Meet the Press the nation's "fifty-first state."
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Jimmy Hoffa

July 9, 1961:This first "Meet the Press" appearance by Teamster president Jimmy Hoffa had to be rescheduled several times due to Hoffa’s string of indictments. After the interview, Hoffa was furious about being asked whether his insistence on dealing only in cash and keeping few records gave the appearance of impropriety.
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Edward Kennedy

March 11, 1962: Edward Kennedy’s first appearance on the program. The potential Senate candidate was coached by his older brother, President John F. Kennedy. President Kennedy and his aide Theodore Sorensen prepared "Teddy" for his “Meet the Press” debut by staging a run through of questions and answers in the Oval Office. On the day of the program, President Kennedy delayed his departure from Palm Beach in order to watch the show, but later told his brother that he was almost too nervous to watch.
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Bob Dole

July 16, 1972: Bob Dole and "Meet the Press" moderator Lawrence Spivak prepare to discuss the break-in and bugging of the Democratic National Committee headquarters at the Watergate. Former Senator Dole holds the record for the most appearances on “Meet the Press” in a career that included service as a Congressman, Senator, RNC Chairman, vice presidential candidate, Senate Majority Leader and finally, Republican presidential nominee.
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Prime Minister Wilson

September 19, 1965: "Meet the Press" conducts television’s very first live satellite interview. The guest is British Prime Minister Harold Wilson.
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Ronald Reagan

September 11, 1966: Ronald Reagan, making his first bid for public office, appears on "Meet the Press" with his Democratic opponent for the governorship of California, the incumbent Gov. Edmund G. Brown. Reagan appeared on "Meet the Press" seven times -- all before he was elected president.
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Robert Kennedy

March 17, 1968: Senator Robert F. Kennedy makes his ninth -- and final -- appearance on "Meet the Press" with Lawrence E. Spivak. Kennedy was assassinated in California less than 3 months later -- shortly after claiming victory in that state's Democratic presidential primary. He was 42 years old.
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John Kerry

April 18, 1971: John Kerry, then a former Navy Lieutenant, makes his first "Meet the Press" appearance as a spokesman for Vietnam Veterans Against the War. He has since appeared on the program as a U.S. Senator from Massachusetts 21 times.
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Golda Meir

December 5, 1971: Golda Meir, prime minister of Israel, appears on “Meet the Press” with moderator Bill Monroe to discuss the continuing instability in the Middle East and the prospect of meeting and negotiating with Egypt’s leaders.
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Prime Minister Gandhi

August 24, 1975: Indian Prime Minister Indira Gandhi in one of her seven appearances on "Meet the Press" before her assassination in October 1984. After she was elected Prime Minister in 1966, Gandhi grew more concerned about her television image and contacted "Meet the Press" to request makeup samples used during her appearance on the program. The program’s makeup artist consulted her notes and sent Mrs. Gandhi a complete makeup set -- including sponges and instructions for application.
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Gerald Ford

November 9, 1975: President Gerald Ford becomes the first sitting American president to appear on the program. President Ford accepted the invitation as a tribute to "Meet the Press" co-founder Lawrence Spivak, who was making his farewell appearance as moderator of the program.
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Jimmy Carter

January 20, 1980: In one of the most dramatic newsbreaks in the history of "Meet the Press" President Jimmy Carter announces that the U.S. would boycott the Moscow Summer Olympics because of the presence of Soviet troops in Afghanistan. Despite initial outrage over Carter’s proposal, 60 nations eventually joined the boycott.
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Richard Nixon

April 10, 1988: In his first Sunday interview in 20 years, Former President Richard Nixon reacts to a comment on "Meet the Press.
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Tim Russert's first show

December 8, 1991: Tim Russert makes his debut as moderator of "Meet the Press." He has since become the longest-serving moderator in "Meet the Press" history. In the center of this photo is then-intern Betsy Fischer, who is now Executive Producer of the program.
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Dan Quayle

September 20, 1992: "Meet the Press" permanently expands from a half-hour to a one hour program. Vice President Dan Quayle is the guest.
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Shaheen and Whitman

February 2, 1997: The broadcast breaks television history as "Meet the Press" becomes the first network television program ever to broadcast live in digital high definition. Governors Jeanne Shaheen and Christie Todd Whitman share a light moment on the set that day.
(Charles Rex Arbogast / AP)
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Bill Clinton

November 9, 1997: President Bill Clinton appears in studio on "Meet the Press" to mark the program’s 50th anniversary.
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Al Gore

December 19, 1999: In a live Democratic presidential debate, Vice President Al Gore challenges former Sen. Bill Bradley to a "Meet the Press agreement" to have weekly debates in place of running political advertisements.
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Dick Cheney

September 16, 2001: Five days after the September 11th attacks, Vice President Dick Cheney joins moderator Tim Russert in the first live television interview ever broadcast from Camp David.
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Senate Debate Series

September 22, 2002: "Meet the Press" kicks off its "Senate Debate Series" with the Colorado Senate race: Republican Incumbent Sen. Wayne Allard vs. Democratic Challenger Tom Strickland. At the end of the election cycle, the series of three senate debates was awarded the prestigious "USC Walter Cronkite Journalism Award" for "Excellence in Broadcast TV Political Journalism." The debate series continued in 2004 and 2006.
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George W. Bush

February 8, 2004: President George W. Bush kicks off his re-election campaign in an Oval Office interview with Tim Russert on "Meet the Press." Robert Novak went on to write about the interview, "no president ever before had been subjected to such tough questioning in the Oval Office."
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James Carville

November 14, 2004: In another "Meet the Press" first, Democratic strategist James Carville cracks an egg on his forehead to demonstrate he's got "egg on his face" after his projected outcome of the U.S. presidential election was wrong. Carville predicted 52 percent of the vote for U.S. Sen. John Kerry (D-Mass.), 47 percent for President George W. Bush and 1 percent for Ralph Nader.
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Jim Webb

November 19, 2006: The first edition of "Meet the Press" to be available via video netcast on the show’s Web site. U.S. Senator-elect Jim Webb (D-Va.) joins moderator Tim Russert on that program.
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June 15, 2008: The chair of late moderator Tim Russert sits empty on the set during the first MTP taping following Russert's death. He died June 13, 2008 of a heart attack while at the NBC News bureau in Washington. He was 58 years old.
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President-elect Obama

December 7, 2008: President-elect Barack Obama makes his first Sunday morning television appearance since winning the election to discuss the challenges facing this country and the upcoming transition of power.
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David Gregory

December 7, 2008: Interim moderator Tom Brokaw announces that David Gregory has been chosen as the new moderator of the show.
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Rendell, Schwarzenegger & Bloomberg

March 22, 2009: Gov. Ed Rendell (D-Penn.), Gov. Arnold Schwarzenegger (R-Calif.) and NYC Mayor Michael Bloomberg appeared exclusively on Meet the Press one day after meeting with President Obama to discuss the economy.
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Hillary Clinton

July 26, 2009: Secretary of State Hillary Clinton appears for a full-hour on Meet the Press. It's her first appearance on the program since joining the Obama administration.
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President Obama

September 20, 2009: President Barack Obama sits down with David Gregory at the White House for Obama's first MTP appearance since taking office.
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Editor's note:
This image contains graphic content that some viewers may find disturbing.